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Most companies receiving Youngstown tax abatements met goals



Published: Fri, December 7, 2012 @ 12:07 a.m.

By David Skolnick

By David Skolnick

skolnick@vindy.com

YOUNGSTOWN

Most of the companies that receive tax abatements from the city have met their investment and job- creation goals.

The city’s tax-incentive review committee met Thursday to review information about tax abatements given to companies for opening or expanding their businesses in Youngstown.

Of the 34 companies with tax abatements, two haven’t yet opened, three others had the abatements eliminated when they left the city or went out of business, and one finished its 10-year tax abatement.

Four companies failed to meet their expected employee-hired projections.

The committee chose Thursday to continue to work with those companies to find ways to increase the number of people hired.

Eliminating the tax abatements for not meeting employee projections would be counterproductive because it would hurt the businesses and the workers they have on staff, said T. Sharon Woodberry, a committee member and the city’s economic- development director.

“Keep in mind that the language [on tax-abatement applications] is best efforts” for hiring, she said.

Allied Consolidated, a demolition-equipment manager, has invested $3.5 million in its business. It expected to hire 16 people over a three-year period after getting a tax abatement from the city in 2006, but hasn’t hired any new workers to date.

Domestic Linens, a uniform-rental company, invested $3.4 million and was to create 100 jobs. It added only 28 jobs, Woodberry said.

Both companies had economic problems because of the national recession, she said.

Gold Cross Ambulance (Rural Metro) invested $1.2 million as part of a 10-year tax-abatement deal with the city in 2001.

It was supposed to hire 15 employees but didn’t hire any and also cut its existing staff from 157 to 71. Because the company moved from Market Street to Midlothian Boulevard, it hasn’t received a tax abatement for a couple of years. Even if it didn’t move, the company’s tax abatement ended in April 2011.

Also, City Printing invested $4.7 million, about $1.9 million more than it projected to spend when it received a tax abatement from the city in 2009.

But the company planned to create 10 new jobs and hasn’t created any.

“We don’t pull abatements if companies make investments,” Woodberry said. “We want to be flexible. Discontinuing the abatements can hurt current employees.”

Mahoning County Auditor Michael Sciortino, chairman of the committee, said it’s been difficult for many companies to grow during the economic downturn of the past few years.

The committee members voted Thursday to continue the existing tax abatements. The final decision rests with city council.


Comments

1WarrenRicheyKid(167 comments)posted 1 year, 9 months ago

Tax abatements are a form of corporate welfare. Companies pit state against state, city against city in the effort to avoid paying taxes.

In the end, it's the citizen who's paying to support public services, not the welfare receiving companies. This gotta end!

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2ytownredux(117 comments)posted 1 year, 9 months ago

What exactly does an investment in the business mean?? If they only improved or upgraded their machines or technology, the company gets the advantage of that and not the city. Those who have not added any employees should show what the value to the city was in either land improvements, moving more business into the city as far as taxable income goes, or city beautification before continuing with abatements.

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3Ytownnative(1041 comments)posted 1 year, 9 months ago

Well just keep giving out tax dollars away We already pay the highest tax rate in the state Im sure new tax increases are on the horizon

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